St Teresa S Novitiate And Training Society Regd vs. State Of Karnataka
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The petitioner, St. Teresa's Novitiate and Training Society, filed a writ petition challenging the Karnataka Municipal Corporations and Certain Other Law (Amendment) Act, 2021 (Karnataka Act No. 01 of 2022), and various other notifications, circulars, and a demand notice issued by the Bruhat Bengaluru Mahanagara Palike (BBMP) and other State authorities. The petitioner sought to declare these enactments and actions as ultra vires the Constitution and to quash specific orders and demand notices. The core of the challenge involved levies such as ground rent, GST on ground rent, license fee, scrutiny fee, and security deposit, which were being demanded by the BBMP for building plan sanction and license issuance.
Held
The High Court, in its order, noted that the issues raised in the present writ petition were substantially covered by a coordinate bench's judgment in W.P.No.23086/2022 and connected matters. The coordinate bench had partly allowed the writ petitions, quashed and set aside the Karnataka Municipal Corporations and Certain Other Law (Amendment) Acts of 2021 and 2023. It was declared that Section 18-A of the Karnataka Town and Country Planning Act, 1961, read with Rules 37-A and 37-C of the Karnataka Planning Authority Rules, 1965, were applicable only to development plans for plots exceeding 20,000 square meters. The court also declared illegal the linkage of fees to market or guidance value under Section 45-B of the Karnataka Stamp Act, 1957. Consequently, all impugned circulars and demand notices giving effect to these provisions were quashed. Clause 3.8 of the BBMP Building Bye-laws, 2003, concerning 'Ground Rent', was also struck down. The ratio decidendi is that amendments and levies found to be unconstitutional, arbitrary, or in conflict with established legal principles, as determined by a higher court, must be set aside, and consequential actions like demand notices must be quashed.
Key Issues
1. Whether the Karnataka Municipal Corporations and Certain Other Law (Amendment) Act, 2021 (Karnataka Act No. 01 of 2022) and the Karnataka Municipal Corporations and Certain Other Law (Amendment) Act, 2023 (Karnataka Act No. 37 of 2024) are ultra vires the Constitution, as contended by the petitioner. The petitioner argued that these amendments, particularly concerning levies like ground rent and associated fees, were arbitrary and unconstitutional. The respondents did not record specific arguments against this contention in the judgment. 2. Whether Section 18-A of the Karnataka Town & Country Planning Act, 1961, read with Rules 37-A and 37-C of the Karnataka Planning Authority Rules, 1965, are applicable only to development plans for plots exceeding 20,000 square meters, as declared by a coordinate bench, and whether the linkage of fees to market or guidance value under Section 45-B of the Karnataka Stamp Act, 1957, is illegal. The petitioner relied on the coordinate bench's findings, while the respondents' specific arguments on this point were not detailed.
Sections Cited
Section 18-A, Section 45-B, Rule 37-A, Rule 37-C, Clause 3.8
AI-generated summary — verify with the full judgment below
Before: DR. AMBEDKAR VEEDHI
The captioned petition is filed seeking the following reliefs: i) Grant an order declaring that the entire Karnataka Municipal Corporations and Certain Other Law (Amendment) Act, 2021 (Karnataka Act No. 01 of 2022) No.DPAL.50SHASANA 2021 notified on 13/01/2022 (ANNEXURE-Q), issued by iii respondent as being ultra vires the Constitution in so far the Petitioner is concerned in so far the Petitioner is concerned. ii) To declare that Karnataka Municipal Corporations and Certain Other Law (Amendment) Act, 2021 (Karnataka Act No. 01 of 2022) No. DPAL.50SHASANA 2021 notified on 13/01/2022 (ANNEXURE-Q) as the impugned Act is an in verbatim reproduction of the Ordinance dated 16/11/2021 at (ANNEXURE-N) is concerned. iii) Grant an order, direction or writ in the nature of certiorari quashing the Office Order No. HaNiNaYo/PR/461/2021-22 dated 09/12/2021 Issued by Respondent No.3 as contained in (ANNEXURE-P) in so far the Petitioner is concerned. iv) grant an order, direction or writ in the nature of Certiorari quashing Section 18-A of the Karnataka Town & Country Planning Act, 1961 brought into effect by Karnataka Act No.23 of 2004 dated 03.06.2004 (Karnataka Town & Country Planning (Amendment) Act) as contained in (Annexure-J) issued by 2nd Respondent insofar as Section 18-A(i) and (iv) of the Karnataka Act No. 23 of 2004 is concerned; HC-KAR NC: 2025:KHC:27144 v) Grant an order, direction or writ in the nature of Certiorari quashing the Notification issued by the 1st Respondent bearing No. UDD 3 TTP 2015 dated 25/02/2020 as contained in (ANNEXURE-H) insofar as the inserted Rule 37-A and 37-C is concerned; vi) issue a writ or order by way of certiorari quashing the circular dated 14/08/2020, bearing No. He.Ni.Ka.Pa.Ko/P.R/320/2020-21 issued by the Respondent No.3 (Annexure-K) in so far the Petitioner is concerned. vii) Grant an order, direction or writ in the nature of Certiorari quashing the Notification issued by the 1st Respondent bearing No. UDD 23 TTP 2020 (E) dated 21/06/2021 as contained In (ANNEXURE-L) insofar as the inserted Rule 37-A and 37-C is concerned; viii) issue a writ or order by way of certiorari quashing the circular dated 24/06/2021, bearing No. He.Ni.Na.Yo/P.R/320/2020-21 issued by the Respondent No.3 (Annexure-M) in so far the Petitioner is concerned. ix) issue a writ or order by way of certiorari quashing the demand notice dated 20-12-2024, bearing LP No.: BBMP/Addl. Dir/JDNORTH/0080/22- 23, PRJ/10740/22-23, issued by the Respondent No. 3 and 4 (Annexure-D) for demanding in so far it is concerned to Ground rent, GST on Ground rent, License fee, scrutiny fee, security deposit, Labour cess and etc., as illegal, without juri iction and arbitrary. x) issue a writ or order or direction by way of mandamus directing the Respondent No.3 and 4 BBMP for issue of New (Fresh Plan Sanction) sanction building in the Schedule Property without insisting the Ground rent (including GST), License fee, scrutiny fee, security deposit, Lake HC-KAR NC: 2025:KHC:27144 Rejuvenation Fee, Compound Wall Fee, Water Supply Scheme (BWSSB), Ring Road (BDA), Improving the Slums (KSCB), MRTS (BDA), 5% Levy service charges, etc.; and xi) pass any such other order(s) as this Hon'ble Court deems fit in the facts and circumstances of the case in the interest of justice and equity.
It is brought to the notice of this Court that across the Bar, the issue is dealt by the Co-ordinate Bench in the reported judgment in W.P.No.23086/2022 and connected matters. The Co-ordinate Bench, while deciding the issue, has set-aside the Karnataka Municipal Corporations and Certain Other Law (Amendment) Act, 2021 (Karnataka Act No.01 of 2022) and the Karnataka Municipal Corporations and Certain Other Law (Amendment) Act, 2023, (Karnataka Act No.37 of 2024). Therefore, this Court deems it fit to cull out the operative portion of the order, which reads as under; "ORDER (i) The writ petitions are partly allowed. HC-KAR NC: 2025:KHC:27144 (ii) The Karnataka Municipal Corporations and Certain Other Law (Amendment) Act, 2021 (Karnataka Act No.01 of 2022), is hereby quashed and set aside. (iii) The Karnataka Municipal Corporations and Certain Other Law (Amendment) Act, 2023, (Karnataka Act No.37 of 2024), is hereby quashed and set aside. (iv) It is hereby declared that the provisions contained in Section 18-A of the Karnataka Town and Country Planning Act, 1961, read with Rules 37-A and 37-C of the Karnataka Planning Authority Rules, 1965, are applicable only in respect of ‘Development Plan’ containing the proposal for construction on plots measuring more than 20,000 square meters in extent and not in respect of plots measuring less than 20,000 square meters. (v) It is hereby declared that if fee has been earlier collected for change of land use or while approving a layout plan, fee shall not be collected for subsequent ‘Development Plan’ in terms of the ‘Note’ found below TABLE I of Rule 37-A of the Karnataka Planning Authority Rules, 1965. (vi) It is hereby declared that the linking of the fee leviable under Rule 37-A of the Karnataka Planning Authority Rules, 1965, to the ‘market value’ or ‘guidance value’ as determined under Section 45-B of the Karnataka Stamp Act, 1957, is illegal. However, liberty is reserved to the respondent-State Government HC-KAR NC: 2025:KHC:27144 and the BBMP to re-fix a standard after collecting empherical data. (vii) Consequently, all the impugned Circulars which seek to give effect to the Rules 37-A and 37-C of the Karnataka Planning Authority Rules, 1965, are hereby quashed and set aside. (viii) It is hereby declared that Clause 3.8 of the Bengaluru Mahanagara Palike Building Bye- laws, 2003, providing for ‘Ground Rent’, is illegal and are accordingly quashed and set aside. (ix) Consequently, all the impugned Demand Notices raised by the respondent-BBMP, in respect of the writ petitioners herein are also quashed and set aside. It would be advisable that the BBMP may come out with a scheme for ‘One Time Settlement’ and settle the levy and collect the fee generally acceptable to the citizens of Bengaluru. This would also augment the present situation."
In the present writ petition, the core issue raised stands substantially covered and decided by the authoritative pronouncement of the coordinate bench, wherein the writ petitions were partly allowed and several consequential reliefs were granted. The Hon’ble Court, in unequivocal terms, quashed and set aside the Karnataka HC-KAR NC: 2025:KHC:27144 Municipal Corporations and Certain Other Law (Amendment) Acts of 2021 and 2023 (Karnataka Act Nos.01 of 2022 and 37 of 2024 respectively).
The Court further declared that the provisions under Section 18-A of the Karnataka Town and Country Planning Act, 1961, read with Rules 37-A and 37-C of the Karnataka Planning Authority Rules, 1965, are applicable only to development proposals concerning plots exceeding 20,000 square meters, and not to smaller plots. Importantly, it was also held that if a fee has been previously collected for change of land use or approval of layout plan, no further fee shall be levied for subsequent development plans, in view of the explanatory 'Note' to Table I of Rule 37-A.
The Court declared illegal the linkage of such levies to market or guidance value under Section 45-B of the Karnataka Stamp Act, and consequently, quashed all Circulars and demand notices issued to give effect to such HC-KAR NC: 2025:KHC:27144 unlawful interpretations. Clause 3.8 of the BBMP Building Bye-laws, 2003, imposing 'Ground Rent', was also struck down.
In view of these comprehensive declarations and findings, it is submitted that the controversy raised in the present writ petition no longer survives for adjudication independently, as it is squarely covered by the binding judgment of the coordinate bench. In the light of the law laid down in the reported judgment substantially covering the issue, which is raised in the captioned writ petition, the writ petition is liable to be allowed strictly aligning to the operative portion of the said writ petition.
In view of the above, this Court proceeds to pass the following; ORDER (i) The writ petition is allowed. (ii) The impugned demand notice dated 20.12.2024 issued by respondents No.3 and 4 as per Annexure-D is hereby set-aside. HC-KAR NC: 2025:KHC:27144 (iii) Respondent- BBMP hereby directed to issue fresh/modified plan as the case may be. (iv) Respondent- BBMP is hereby directed to forthwith process the petitioner's application seeking building license and sanction of the building plan, strictly in accordance with law. (v) It is made clear that the issuance of the building license and approval plan shall not be withheld merely on the ground that the BBMP is contemplating to file an appeal against the reported judgment. (vi) If the building license and sanction plan are issued, the same shall be subjected to the outcome of any appeal that may be filed by the BBMP against the judgment. Pending applications, if any, are also disposed off. (SACHIN SHANKAR MAGADUM) JUDGE HDK List No.: 2 Sl No.: 38
Reproduced from the public record of the Karnataka High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.